Lessons from soggy oil & gas auctions

 

Lessons from soggy oil & gas auctions

The response to India’s first open acreage(एकड़ों में नाप/ क्षेत्रफल /कृषि) auction(नीलाम) for hydrocarbon exploration(जंच पड़ताल/खोज) and development has not quite set the Yamuna on fire. No foreign oil major responded. Reliance kept away. Vedanta-Cairn has been recommended(की सिफारिश की) by an empowered committee of secretaries for award of 41of the 55 blocks on offer, and state-owned ONGC for two blocks. Open acreage, not distinguishing(विशिष्ठ/विशेषता-सूचक) between oil and natural gas, revenue-sharing instead of the profit-sharing after cost-recovery model, ill-suited(उपयुक्त है) for India’s trust deficient(कमी ) political economy — these are all sound features of the auction. Yet, the response has been tepid(कमजोर /कुछ कुछ गर्म). The government needs to introspect(आत्मनिरीक्षण/अंतर्दर्शन करना) why. The way Cairn has been treated is an obvious(स्पष्ट/ज़ाहिर) deterrent(निवारक/बचाव का) for foreign majors. It is one company that can claim to have actually dented India’s oil import bill by discovering hydrocarbons in places that others had failed to. It undertook a consolidation(एकत्रीकरण/समेकन) exercise for assorted(चयनित/विभिन्न) companies operating in India’s oil and gas sector, with prior official intimation and no change of beneficial ownership.

Yet, a retrospective(पूर्वप्रभावी /पूर्वव्यापी)tax was slapped on the company for imputed(लगाया/आरोपित) capital gains. The tax dispute has dragged on, the government has frozen(जमा हुआ) its assets(संपत्ति) and the uncertainty has hurt its global market valuation(मूल्यांकन/क़ीमत लगाना). Why should foreign oil majors rush to invest in India’s minefield of arbitrariness(मनमानी करना/निरंकुशता) ? It is also worth asking what the nation has gained from the emaciation of ONGC. It was made to take over GSPC, Gujarat’s costly misadventure into deepwater exploration, its coffers were raided for the make-believe disinvestment(लगाया गया पैसा वापस लेना/विनिवेश) in HPCL, the government’s stake in the company being sold to ONGC, which had to borrow heavily to finance the acquisition(प्रप्ति/अधिग्रहण), and it was also persuaded(आश्वस्त) to make a huge dividend(लाभांश) payment to the government, besides investing in Russia’s Rosneft. ONGC today lacks the financial muscle to play a muscular role in developing India’s hydrocarbon reserves(भंडार). If the government is serious about slashing import dependence for oil, ONGC must be allowed to play its intended (उद्दिष्ट/प्रयोजन रखने का) role, not serve as a cash cow for the government

 

 

Important Vocabulary

1.Auction
Synonyms: sell-off, bargain, jam

2.Intended (उद्दिष्ट/प्रयोजन रखने का
Synonyms: calculated, contracted, designed, expected, planned
Antonyms: unfixed

3.deterrent(निवारक/बचाव का)
Synonyms: disincentive, hindrance, obstacle, bridle, check
Antonyms: assistance, help, encouragement, catalyst, incentive

4.Obvious(स्पष्ट/ज़ाहिर)
Synonyms: accessible, clear, conspicuous, discernible, distinct
Antonyms:ambiguous, concealed, dark, disputable, doubtful

5.Assorted(चयनित/विभिन्न)
Synonyms: sundry, diversified, mixed, motley, varied
Antonyms: like, same, similar, unvaried

6.Frozen(जमा हुआ)
Synonyms:chilled, frigid, ice-cold, iced, icy
Antonyms: hot, warm, boiled, continual, continued

7.Arbitrariness(मनमानी करना/निरंकुशता)
Synonyms: absurdity, arbitrariness, caprice, illogicality, illogicalness

8.Acquisition(प्रप्ति/अधिग्रहण)
Synonyms: addition, gain, procurement, purchase, recovery
Antonyms: loss, failure, forfeit, surrender, dearth

9.Intended (उद्दिष्ट/प्रयोजन रखने का
Synonyms:calculated, contracted, designed, expected, planned
Antonyms: unfixed

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